The Demarcation agreement in trademark law is an agreement between two parties who are trademark owners or own trademark rights. The aim of this agreement is to avoid potential conflicts in connection with the use of similar trademarks by defining clear boundaries and responsibilities for the use and protection of trademarks. It usually serves to eliminate uncertainties about the scope of trademark protection and to prevent legal disputes
Main features of a delimitation agreement in trademark law:
- Definition of responsibilities: The agreement specifies which party has the exclusive right to use certain trademarks and in which geographical or commercial areas these trademarks may be used.
- Avoidance of trademark collisions: A clear demarcation is intended to avoid trademark collisions in which similar trademarks are used by different parties in the same markets or business areas.
- Definition of license conditions: If the agreement includes the licensing of trademark rights, the conditions for licensing, such as license fees and duration, are defined.
- Clarification of injury risks: The agreement can minimize risks of trademark infringement by establishing clear rules for the use and protection of trademarks.
- Division of geographical markets: If the parties involved operate in different geographic regions, the agreement may divide the use of the trademarks in certain regions to prevent conflicts.
Delimitation agreements in trademark law are particularly relevant when it comes to similar or related trademarks that are present in the same markets or industries. They provide the parties involved with a legal structure to protect their respective rights while ensuring that there are no unwanted conflicts. Such agreements may be voluntary or may arise as part of a court or out-of-court settlement between the parties.